Sector analyst Jud Bailey has cited the maturing newbuild cycle as being behind a slowing down in forecasted performance at National-Oilwell Varco.

Bailey does say that despite his own downgrade he believes that sentiment for NOV has gotten a bit too bearish with the ~15% underperformance relative to peers over the last few months.

"We are downgrading the shares to a Buy from a Strong Buy to reflect slower top line and EPS growth as the newbuild cycle matures. To account for slower growth, which will largely be driven by business segments outside the Company's rig equipment business, we are lowering our price target to $83 from $105, which is based on 11.5x our revised 2014 EPS estimate," says Bailey.

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Although ISI believe there is a compelling case that NOV only trades at 10-11x forward EPS going forward, "we are using a slightly higher multiple to account for some accretive use of the Company's 6-9% free cash flow yield (acquisitions, share repurchases, etc)," says Bailey.

ECB LTRO repayments underpin robust market sentiment

Markets are looking to end the week in fine form; provided the current bullish tone amongst investors continues through the North American session.

European markets have set the positive tone after the ECB announced 278 banks are to repay €137bn in cheap funding to the European Central Bank on January 30.

A figure above 100bn was said to be positive for sentiment by UBS ahead of the announcement.

The ECB started offering cheap three-year money to banks in December 2011.

The two so-called longer-term refinancing operations were greeted as a decisive step in restoring confidence in the eurozone’s financial system and ultimately led to the ECB pumping €1tn into about 800 banks.

Elsewhere: The end of symbian

Nokia has confirmed the end of the Symbian smartphone operating system.

Nokia confirmed that the 808 PureView was the last new device:

"During our transition to Windows Phone through 2012, we continued to ship devices based on Symbian. The Nokia 808 PureView, a device which showcases our imaging capabilities and which came to market in mid-2012, was the last Symbian device from Nokia."

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